Patsy Folson is evaluating what appears to be an attractive opportunity. She is

Question

  Patsy Folson is evaluating what appears to be an attractive opportunity. She is currently the owner of a small manufacturing company and has the opportunity to acquire another small company's equipment that would provide production of a part currently purchased externally. She estimates that the savings from internal production will be $75,000 per year. She estimates that the equipment will last 10 years. The owner is asking $400,000 for the equipment. Her company's cost of capital is 8 percent. Calculate the IRR for Patsy Folson

Explanation / Answer

try 14%...i guess it should work

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